As if on cue from the US markets, the Indian markets on Wednesday shrugged away all hiccups and started moving in a northward trajection. But as the day wore off, the markets started losing their gains.
Under the circumstances, what strategy should the investors follow?
Is this the right time to buy stocks? If so, which stocks and sectors should you concentrate on?
In an hour-long chat on rediff.com on Wednesday, market expert Pranav Sanghavi replied to many such readers' questions. Here is the transcript:
PRANAV SANGHAVI says, Good afternoon and welcome to the chat. Due to some technical problems at Rediff's end the chat has begun late. Let's begin.
susantaguru asked, Hi, Can you please tell me what happening in HFCL, INDOWIND energy, why these are moving up everyday in terms of 5 & 10% since last few trading sessons.
PRANAV SANGHAVI answers, at 2008-04-02 16:15:46These are operator driven trader friendly stocks. I would not invest in them even if they are moving up in such volatile conditions.
brinda asked, Hi should be hold punjlloyd , larsen
PRANAV SANGHAVI answers, Punj Lloyd looks to have been hit by the real estate crash scare in the market. Larsen on the other hand could be accumalated at lower levels with a 6 to 12 month outlook.
jain asked, Sir, I am having huge money to invest in share market. Pls suggest me just one stock which can give me best return after 12 months or more time. Just suggest me only one stock.
PRANAV SANGHAVI answers, If you have a large amount to invest, I would surely not invest into a single stock. You should look at large cap growth stocks who are growing their profits at over 20%.
ALOK asked, hello Sir, What are yours views on BHEL and why is is falling everyday even market is rising?
PRANAV SANGHAVI answers, BHEL is a qwuality stock and should be accumalated on every dip. BHEL did have a lot of open interest in the Derivative segment and with SEBI's new directive traders are pruning their position in the active arbitrage stocks like BHEL. The volumes have come down drastically.
rrak asked, I have BHEL bought @ 1970. Should i hold?
PRANAV SANGHAVI answers, You could average further on days when the markets correct with a 6 to 12 month outlook.
KING asked, Sir what is your view on united sprits?
PRANAV SANGHAVI answers, I am bullish on the stock. I would accumalate at lower levels witha 6 month outlook.
raj asked, hi is it good to play on nifty futures
PRANAV SANGHAVI answers, The markets are in a volatile stage and are extremely news sensitive. Any news positive or negative sends the markets moving immediately in that direction respectively. I would definately not trade on the Nifty Futures at this moment. You could use them to hedge your positions in the cash markets at most.
Dsingh asked, Hello Sir, I have noidatoll at Rs.42. My question is should i need to hold or sell at this moment?
PRANAV SANGHAVI answers, You will have to hold on as the stock should take some time to reach it previous highs.
Rish asked, is this a good time to sell?
PRANAV SANGHAVI answers, All upward rallies are getting sold into currently. If you are a extremely short term trader you could look at selling on every major rally. But if you are an investor I would not sell at current levels.
rajiraju asked, Hi. What will be thefuture of low value shares which are quoted less tha Rs 5.00 If we invest on these , will be able to see some profit. What would be the preferred qty to lock
PRANAV SANGHAVI answers, In this market scenario all the penny stocks should be on seller circuits. I would not look at them as an investment at all.
BB asked, I am holding Unitec at Rs. 360 and IFCI at Rs. 60. Should I hold or sell with losses?
PRANAV SANGHAVI answers, You could hold on both these stocks. Both would bounce back equally quickly if the markets were to turn around. But that turnaround does look difficult in the near term.
desai asked, Dear Sir please comment - RPL@ 205, RPower@375, REL@ 1575. For how Long? Thanks
PRANAV SANGHAVI answers, You will have to look at RPL with at least a 1 to 2 year outlook. REL with a 6 to 12 month outlook. RPower will take much longer than both the other stocks to garner strength.
Ashwani asked, HI Pranav what is your target of next 6 months for BHEL, GMR, LNT, DLF, KCP, KS OILS, WELSPUN GUJ, NOIDA TOLL, HIND MOTORS, ARVIND MILLS and RPL?
PRANAV SANGHAVI answers, I would say that from current levels you could expect the stocks to give you a 10% return BUT only if the following hold good. One, corporates maintain their growth rates of previous years. Two, the inflation comes under control and the governmnet does not need to hike interest rates. Three, the US markets do not go into a recession. There are various factors affecting our markets right now.
sarang asked, i've 1000 shares of rel petro @ 166 per share. what do i do? how much is it expected to go in the next 3 months
PRANAV SANGHAVI answers, RPL would not see major movements in just 3 months. Unless some positive news breaks out. You would have to wait for atleast 1 to 2 years.
Shankar asked, Hello Pranav. My question is to whether exit mutual funds at the end of SIP? For eg. I did a 12 SIP @ 5k/ month on Reliance Vision which finished its tenure in Dec 07. Should I exit it and reenter thru another SIP or let it continue as it may become a single investment in that case.
PRANAV SANGHAVI answers, Normally MF's are looked at with a long term perspective. If you have invested in the same for a short term you could withdraw the same but at the current levels the NAV of the funds would be low. Ideally if you continue the investment over 3 to 5 years you should see a decent return on your investment.
rancho asked, Hi I have L&T, Ambuja Cement, Rel Power, ICICI Bank, DLF. Should hold/buy/sell ?
PRANAV SANGHAVI answers, I would definately hold on to all these stocks. I would not panic and sell. R Power could surely be switched to say a NTPC.
rajeev asked, How will Mah seamless perform going forward- bought at 322.
PRANAV SANGHAVI answers, With the government hinting at steel manufacturers to cut their prices in the short term all steel players will have a negative impact. Over a longer term steel producers should do well due to infrastructure spendin push by the government in the budget.
selva asked, Any major reason behind closing reliance petrol bunks ? Will that affect reliance petroleum stocks ?
PRANAV SANGHAVI answers, They were making huge losses and the management felt that they would not be able to become profitable in the current scenario of rising crude prices.
AK asked, Good evening! Mr Pranav Sanghavi, is it the right time to buy new stocks or the market is still volatile ? if its the right time, what stocks shall i buy ?
PRANAV SANGHAVI answers, Markets are still volatile and I would not jump in at these levels. I would still wait for some correction before looking at entering the markets.
horizon asked, What will be ur best 5 picks for 6-8 months outlook..
PRANAV SANGHAVI answers, I would look at DLF, L&T, SBI, RIL, IDFC, NTPC and some more stocks at current levels.
Vimal.S asked, Hello Pranav. In the cuurent market scenario is it better in invest in MF ina single payment or using SIP?
PRANAV SANGHAVI answers, In the short term the markets should remain volatile. SIP is a better way to reduce the volatility of a market. But if there is a January type correction again you could opt for a 1 time investment also.
kks asked, I have JK Ind @145, Idea celluar @114, Hotel Leela @45 .. whats ur view on this? How long shld I hold this?
PRANAV SANGHAVI answers, I would hold on to these stocks. THey have got hit in the recent correction but in 6 to 12 months you should see better prices.
mmtk asked, Can you suggest levels to enter BHEL; DLF and Unitech : Time horizon for investment 12-18 months
PRANAV SANGHAVI answers, I won't be able to suggest levels but you could buy in parts every time the stocks corrects over 2.5 to 3% in a day.
Atish asked, Hello, I would like to know about HDFC shares unit rate, we seen a huge losses to some of the banks such as City Bank etc in the last sensex drop down, HDFC was a bit stable ....
PRANAV SANGHAVI answers, HDFC has come on record and said they do not have any major exposure to the US sub-prime mortgage market. So I don't think they should be hit as badly with the problem that CitiBank has faced.
Chinku asked, Hi Pranav. I hold about 60 shares of ITC. At what rate can I buy more for medium-long term investment ?
PRANAV SANGHAVI answers, You could look at the stock if it touches 190 or below.
PRANAV SANGHAVI says, Well it's been great chatting with you guys although the session has been truncated by some technical problems at Rediff's end. Bye for now.
Chat with Pranav every Wednesday at 4 pm
(Due to circumstances beyond our control, date and time of chat may change)
